Greggs Plc has announced plans to close four of its UK manufacturing sites in a restructuring of its production network that could result in around 740 job losses over the next two and a half years. The Newcastle-headquartered bakery chain said the closures would initially cost £60m, including disruption costs and redundancy payments, but could generate annual savings of £20m by 2028. The factories earmarked for closure are located at Enfield in Greater London, North Lakes near Penrith in Cumbria, Pettigrews in Kelso in Scotland, and Seaham in County Durham.
Greggs said distribution operations will continue at the Enfield site, and its Treforest facility in Wales will also be affected by the changes, though it will remain open as a distribution centre. The company added it will reduce the range of products manufactured at its Clydesmill Glasgow and Manchester locations, and will stop tinned bread production at its Gosforth site. Greggs confirmed that its retail shops will not be affected by the changes, and said it will shortly begin a consultation process with affected workers and their union representatives, stressing that no final decisions have been made.
Chief executive Roisin Currie said Greggs must 'keep evolving alongside changing customer expectations to continue building a successful business for the future' [Source: Enfield Independent (PA)]. The announcement came alongside an update in which Greggs told investors that while stronger sales had 'modestly improved' its outlook for the current year, 'there are signs of greater inflationary pressures in 2027' [Source: The Guardian]. The company reported sales growth of 7.7% in its most recent quarter, up from 7.2% in the first half of the year, and said current cost inflation is 'well managed' and likely to remain around 2% for 2026.
Shares in Greggs rose sharply on the news, gaining 6.5% to 1,997p and reaching their highest level for around two months. Earlier in the trading session the stock was up as much as 7.3%, making it the best performer across the mid-cap FTSE 250 index and taking its year-to-date rise to 17%.
Greggs, which employs more than 33,000 people across the UK, has continued to expand its retail footprint alongside the manufacturing overhaul. The company has opened 95 new shops and closed 38 in the year to date, taking its overall estate to 2,796 shops, and predicted it will add between 100 and 110 net new shops by year end. Earlier this year, Greggs raised the price of its bestselling sausage roll by 5p to £1.35 in most shops, and increased the price of a latte by 10p to £2.25, as it looked for ways to combat rising wage, energy and packaging costs.
Sources: Bloomberg, The Guardian, BBC Business, Enfield Independent (PA)